The Fair Work Ombudsman has flagged high rates of non-compliance in the food services and accommodation industry; with a particular focus on cafes, restaurants and takeaway fast food businesses.

More than one third of court matters in 2015-2016 and approximately 40% of Enforceable Undertakings reportedly involved those in the food services and accommodation industries. Unsurprisingly, the majority of these matters were the result of the Ombudsman receiving an online complaint through their website, with workers aged 30 years or younger more likely to report non-compliance.

Cafes, restaurants and fast food businesses are being specifically targeted by the Fair Work Ombudsman. Can you afford to risk the significant penalties for non-compliance?

As an alternative to court action, the Ombudsman is increasingly using Enforceable Undertakings to resolve workplace disputes. These are generally used where the employer is prepared to fix the problem and is willing to take preventative measures that ensure it won’t occur in the future.

What is an Enforceable Undertaking?

As an alternative to court action, the Fair Work Ombudsman may accept a written agreement or promise from anyone whom they believe has contravened the terms and conditions of a Modern Award, an Enterprise Agreement or the National Employment Standards. This is called an ‘Enforceable Undertaking’ as the agreement can be enforced by a court.

What happens if an Enforceable Undertaking is not complied with?

As mentioned, the agreement can be enforced by a court.

The courts have power to order substantial penalties in the event that an employer has breached the Act; up to $54,000 per contravention for a corporation and up to $10,800 per contravention for any individual who is involved in a contravention.

As well as penalties, the Fair Work Ombudsman has the power to seek orders for the recovery of unpaid wages and entitlements. A total of $3.85 million in unpaid wages and entitlements was reportedly recovered in 2015 – 2016 as a result of employers entering into Enforceable Undertakings. This was up on the $3.75 million recovered the previous year.

For more information on the recommendations and what this means for you, clients should contact the HR Assured team. If you’d like more information about the benefits of becoming an HR Assured client contact us today for an informal chat.